Living wage request for actors and compensating wage differentials

Ian McKellen calls for a "living wage" for all actors.

Excerpt:

A recent report found just one actor in 50 earned more than £20,000 a year.

“Most actors are not rich – they are very poor indeed. What keeps them going is that they just love the job,” Sir Ian told Radio Times.

He said: “I know actors who have had to turn down good roles because they just don’t pay enough. It’s hard. The one thing you can ask, I think, is that actors get paid a living wage. I would like it if all the repertory theatres that currently exist could do that. It would make a huge difference.”

The “living wage” currently stands at £8.80 an hour in London.

In labor economics, we study compensating wage differentials.  Different textbooks have slightly different formal definitions, but wikipedia's is OK.  They write that a compensating wage differential ...

is a term used in labour economics to analyze the relation between the wage rate and the unpleasantness, risk, or other undesirable attributes of a particular job. A compensating differential, which is also called a compensating wage differential or an equalizing difference, is defined as the additional amount of income that a given worker must be offered in order to motivate them to accept a given undesirable job, relative to other jobs that worker could perform. One can also speak of the compensating differential for an especially desirable job, or one that provides special benefits, but in this case the differential would be negative: that is, a given worker would be willing to accept a lower wage for an especially desirable job, relative to other jobs.

Acting is a very desirable profession.  Because of that, the wage rates will be low as actors will be receiving a negative compensating differential.  If McKellen had his way and the wage rates were made higher, more people would choose acting as a career.  This would mean even more people who wish to act being unable to find a job.

Given there is a surplus of actors, one could argue that wages for actors, as low as they are, are actually too high.  There are many subsidies in London for the theatre, which likely makes this the case.  These subsidies have led to these increased numbers of people seeking jobs as actors.